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This Legendary Music Retailer Made Millions Online. So Why Did They Open a Studio? How Sweetwater continues making beautiful music -- and profits -- after four decades in the business.

By Dan Bova

entrepreneur daily
Erick Anderson

In 1979, musician Chuck Surack had an idea that literally rocked and rolled: he built a mobile recording studio in a VW bus. Over the course of several decades, he drove that business into a multi-million dollar online music retailer, Sweetwater Sound, based in Fort Wayne, Indiana. About a decade ago, the company decided to go against the retail trend and went back to its roots by opening a multi-room recording facility, Sweetwater Studios. That brick-and-mortar gamble has paid off with a thriving business that now offers a wide range of services for musicians -- from recording to album art to coffee for late-night sessions.

Entrepreneur connected with Mark Hornsby, Vice President of Operations of Sweetwater Studios, to discuss the highs and lows of standing up a physical business in a digital world.

Related: 10 Essential Tips For a Long and Lucrative Music Career

Why open Sweetwater Studios? How has that affected your online sales business?

Sweetwater was originally founded as a recording studio in 1979. Today, the studios continue to be one of the cornerstones of the company. As a retailer, we not only sell professional audio and musical instrument equipment, we actually use it and test it out on real-world sessions with real artists. We work hand in hand with our vendors to beta test new products and provide feedback-help them do a better job -- not just for us, but for all of their customers. Simultaneously, artists who record at Sweetwater have access to more instruments and equipment than any other place on the planet. What they hear in their head is only limited by their imagination, and we provide the tools and services to make it real.

What were the key considerations in developing the studio, especially considering modern brick and mortar challenges?

In being a division of our online parent company, we are all too aware of how consumers have shifted from shopping at physical stores and moving into ecommerce. That said, while the equipment we use in our studios is available for purchase online, the millions of dollars we have invested in the design and construction of our recording studio facilities are not. In developing the recording studio facilities, we took into account the entire physical ecosystem we offer at Sweetwater: the studios designed by Russ Berger, our coffee shop and restaurant, our fitness center, and of course the hundreds of thousands of square feet of equipment at an artist's disposal. The sum total of this is that recording at Sweetwater Studios is very much a destination experience.

Related: He Makes Guitars Out of Torn-Down Buildings in Detroit. Does That Rock or What?

How have changes in the music business changed your business, if at all?

It's no secret that the music business has certainly changed a lot in recent years. We have embraced that fact, and in a lot of ways, music is a marketing tool for an artist's brand as much as it is a piece of art or anything else. These days, an artist's revenue streams are primarily driven by live performance, merchandise sales and creative partnering. This works synergistically with our own business, and we work side by side with artists to help them establish their goals, identify the critical success factors and help achieve the best possible music production.

What do you see as the main point of differentiation for what you are as compared to other studios?

In a lot of ways, we are a one-stop shop. In identifying our place in the marketing food chain, we concluded that providing a great sounding product isn't enough. People hear what they see -- for example, you put two albums side by side, and one has a great design with some really creative photos and the other looks like someone's friend did the design because they owed them a favor, which one would you assume sounds better? For that reason, we also offer photography, graphic design, music videos, and a range of other services. Whatever you need to showcase your music and tell your story to the world, there is a good chance we've got you covered.

Related: How a Guitar Player With a Problem Turned $12,000 in Savings into a $1.4 Million Business

What has been your biggest struggle with the studio operation's success and how did you overcome it?

Much like many other companies operating in other verticals, market awareness continues to be a challenge. As a retailer, we have millions of customers, and many of them simply do not know we have a studio -- even though it is so much a part of our story. In today's marketplace, the power of "word of mouth' is often overlooked. The recording studio world is a very niche business, and people talk. We have grown leaps and bounds just by word of mouth -- musicians will come here, see what we have to offer, and then tell others. Happy customers are a lot more likely to tell their friends about their experience, and in this business, this is still a driving force of our growth.

Dan Bova

Entrepreneur Staff

VP of Special Projects

Dan Bova is the VP of Special Projects at Entrepreneur.com. He previously worked at Jimmy Kimmel Live, Maxim and Spy magazine. Check out his latest humor books for kids, including Wendell the Werewolf, Road & Track Crew's Big & Fast Cars, and The Big Little Book of Awesome Stuff.

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